What was the total revenue from franchised restaurants and other sources for Carl's Jr. Funding LLC?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
28 | | Operating leases, less current portion | 269,290 | — | — | 80,987 | — | — | — | 350,277 | | Other long-term liabilities | 68,431 | (1) | — | 194,080 | — | — | — | 262,510 | | Total liabilities | 416,763 | 622,561 | — | 326,751 | 592,747 | — | (79,292) | 1,879,530 | | Members' equity (deficit): | | | | | | | | | | Members' equity (deficit) | 402,040 | (584,635) | — | 525,624 | (591,535) | — | — | (248,506) | | Total liabilities and members' deficit $ | 818,803 $ | 37,926 $ | — $ | 852,375 $ | 1,212 $ | — $ | (79,292) $ | 1,631,024 |
THE CKE SECURITIZATION ENTITIES COMBINING CONSOLIDATING STATEMENT OF OPERATIONS (In thousands)
Fiscal 2024
| Carl's Jr. Restaurants LLC | Carl's Jr. Funding LLC | Carl's Jr. SPV Guarantor LLC | Hardee's Restaurants LLC | Hardee's Funding LLC | Hardee's SPV Guarantor LLC | Eliminations | The CKE Securitization Entities | |||
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue: | ||||||||||
| Company-operated restaurants | $ 112,928 $ | — $ | — $ | 255,914 $ | — $ | — $ | — $ | 368,842 | ||
| Franchised restaurants and other | 175,402 | 5,643 | — | 117,311 | 12,594 | — | (18,237) | 292,713 | ||
| Total revenue | 288,330 | 5,643 | — | 373,225 | 12,594 | — | (18,237) | 661,555 | ||
| Operating costs and expenses: | ||||||||||
| Company-operated restaurants: | ||||||||||
| Food and packaging | 28,645 | — | — | 69,234 | — | — | — | 97,879 | ||
| Payroll and other employee benefits | 34,371 | — | — | 88,269 | — | — | — | 122,640 | ||
| Occupancy and other | 36,600 | — | — | 86,253 | — | — | (18,237) | 104,616 | ||
| Total company-operated restaurants | 99,616 | — | — | 243,756 | — | — | (18,237) | 325,135 | ||
| Franchised restaurants and other | 68,884 | — | — | 24,742 | — | — | — | 93,626 | ||
| Advertising | 6,889 | — | — | 13,837 | — | — | — | 20,726 | ||
| General and administrative | (2,038) | 24,442 | — | 213 | 25,336 | — | — | 47,953 | ||
| Facility action charges, net | (1,128) | — | — | 3,311 | — | — | — | 2,183 | ||
| Total operating costs and expenses | 172,223 | 24,442 | — | 285,859 | 25,336 | — | (18,237) | 489,623 | ||
| Operating income (loss) | 116,107 | (18,799) | — | 87,366 | (12,742) | — | — | 171,932 | ||
| Interest expense | (1,460) | (27,431) | — | (5,652) | (27,320) | — | — | (61,863) | ||
| Other income (loss), net | 3,589 | 112,499 | 61,153 | 406 | 81,860 | 36,915 | (291,632) | 4,790 | ||
| Income (loss) before income taxes | 118,236 | 66,269 | 61,153 | 82,120 | 41,798 | 36,915 | (291,632) | 114,859 | ||
| Income tax expense | 4,453 | — | — | 1,461 | — | — | — | 5,914 | ||
| Net income (loss) | $ 113,783 $ | 66,269 $ | 61,153 $ | 80,659 $ | 41,798 $ | 36,915 $ | (291,632) $ | 108,945 | ||
THE CKE SECURITIZATION ENTITIES COMBINING CONSOLIDATING STATEMENT OF OPERATIONS (In thousands)
Fiscal 2023
| Carl's Jr. Restaurants LLC | Carl's Jr. Funding LLC | Carl's Jr. SPV Guarantor LLC | Hardee's Restaurants LLC | Hardee's Funding LLC | Hardee's SPV Guarantor LLC | Eliminations | The CKE Securitization Entities | |
|---|---|---|---|---|---|---|---|---|
| Revenue: | ||||||||
| Company-operated restaurants | $ 111,433 $ | — $ | — $ | 242,820 $ | — $ | — $ | — $ | 354,253 |
| Franchised restaurants and other | 168,244 | 5,579 | — | 122,587 | 11,835 | — | (17,414) | 290,831 |
| Total revenue | 279,677 | 5,579 | — | 365,407 | 11,835 | — | (17,414) | 645,084 |
| Operating costs and expenses: | ||||||||
| Company-operated restaurants: | ||||||||
| Food and packaging | 28,226 | — | — | 70,215 | — | — | — | 98,441 |
| Payroll and other employee benefits | 32,897 | — | — | 80,466 | — | — | — | 113,363 |
| Occupancy and other | 35,240 | — | — | 82,317 | — | — | (17,414) | 100,143 |
| Total company-operated restaurants | 96,363 | — | — | 232,998 | — | — | (17,414) | 311,947 |
| Franchised restaurants and other | 66,917 | — | — | 24,089 | — | — | — | 91,006 |
| Advertising | 6,774 | — | — | 12,502 | — | — | — | 19,276 |
| General and administrative | 6,694 | 23,462 | 1 | (724) | 26,515 | — | — | 55,948 |
| Facility action charges, net | 526 | — | — | 3,063 | — | — | — | 3,589 |
| Total operating costs and expenses | 177,274 | 23,462 | 1 | 271,928 | 26,515 | — | (17,414) | 481,766 |
| Operating income (loss) | 102,403 | (17,883) | (1) | 93,479 | (14,680) | — | — | 163,318 |
| Interest expense | (1,557) | (27,649) | — | (6,021) | (27,525) | — | — | (62,752) |
| Other income (loss), net | 1,131 | 96,478 | 60,645 | 690 | 80,449 | 33,389 | (270,725) | 2,057 |
| Income (loss) before income taxes | 101,977 | 50,946 | 60,644 | 88,148 | 38,244 | 33,389 | (270,725) | 102,623 |
| Income tax expense | 3,282 | — | — | 1,544 | — | — | — | 4,826 |
| Net income (loss) | $ 98,695 $ | 50,946 $ | 60,644 $ | 86,604 $ | 38,244 $ | 33,389 $ | (270,725) $ | 97,797 |
Carl's Jr. SPY Guarantor LLC and subsidiaries, and Hardee's SPY Guarantor LLC and subsidiaries (the "CKE Securitization Entities")
Combined Consolidated Financial Statements for the fiscal years ended January 30, 2023 and January 31, 2022
(With Independent Auditors' Report Thereon)
KPMG LLP 1201 Demonbreun Street Suite 1100 Nashville, TN 37203
Independent Auditors' Report
Managing Member Carl's Jr. SPV Guarantor LLC and Hardee's SPV Guarantor LLC:
Opinion
We have audited the combined consolidated financial statements of Carl's Jr. SPV Guarantor LLC and its subsidiaries, and Hardee's SPV Guarantor LLC and its subsidiaries (the Company), which comprise the combined consolidated balance sheets as of January 30, 2023 and January 31 , 2022, and the related combined consolidated statements of income, members' deficit, and cash flows for each of the fiscal years then ended, and the related notes to the combined consolidated financial statements.
In our opinion, the accompanying combined consolidated financial statements present fairly, in all material respects , the financial position of the Company as of January 30, 2023 and January 31 , 2022, and the results of its operations and its cash flows for each of the fiscal years then ended in accordance with U.S. generally accepted accounting principles.
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 79–80)
What This Means (2024 FDD)
According to Carls's 2024 Franchise Disclosure Document, Carl's Jr. Funding LLC's revenue from franchised restaurants and other sources was $5,643 for one period and $5,579 for another.
It is important to note that these figures are presented within a larger table that includes financial data for other related entities like Carl's Jr. Restaurants LLC, Hardee's Restaurants LLC, and Hardee's Funding LLC. The table also includes eliminations and the CKE Securitization Entities, which are used for consolidated reporting purposes. The franchised restaurants and other revenue includes royalties, franchise fees, and rent revenue.
A prospective Carls franchisee should understand the relationship between these different entities and how revenue is allocated among them. It's also important to understand what "other" revenue sources are included in this line item, as it could include items like vendor rebates or other forms of income. Further investigation into the specific accounting practices would be needed to fully understand these revenue streams.